ILoveGay.NET

After Abercrombie & Fitch (A&F), which has been around since 1892, became extremely popular, especially through the gay market in the 1990s and 2000s, the brand suffered enormous damage due to internal policies and public scandals. Last week I wrote about the rise of the brand, now I look at its ‘fall’.

Exploitation

Former A&F CEO Mike Jeffries was accused of sexual exploitation by eight men earlier this year. This involved attending ‘events of the CEO and his partner’, i.e. in private. However, they were promised a modeling career with A&F if they attended the meetings – so the brand was linked to it. Improper practices have come to light before.

Jeffries was in charge of the fashion chain between 1992 and 2014 and made the clothing popular among teenagers and twenty-somethings. He did this with marketing and advertising that mainly focused on young, white and athletic models. These models were often half undressed. There were also bare-chested boys at the entrances of the shops with whom customers could have their pictures taken. At the time they were still called ‘models’, later this became ‘brand representatives’. They caused quite a stir, and also provided ‘crowd control’: there always had to be a line, even if the store was not full. You couldn’t look into that store, because the windows were shuttered and there was little display material. Mystery!

When he left, Jeffries was already under fire for poor sales figures and statements about the type of clientele desired by A&F. According to him, the clothing was only intended for ‘cool kids’ and ‘good-looking people’.

Netflix

Last year, Netflix released the documentary ‘White Hot: The Rise & Fall of Abercrombie & Fitch’. This describes the brand’s successes and controversies, including racist and exclusionary practices. The documentary focuses on the brand’s rise in popularity following the arrival of Jeffries in 1992. A&F took over shopping centers in the late ’90s and early ’00s with beautiful models, pulsating dance beats and the strong scent of one of their perfumes found in and around the store: scent marketing!

However, Jeffries’ practices led to a class action lawsuit in 2003 alleging (racial) discrimination in the stores’ recruitment policies. The company’s toxic culture was also fully exposed. The ‘All American’ image collapsed.

But the gays had already turned their backs on them. When the label was noticed being worn by students and straight people in their twenties, and the brand had spoken out against the gay image several times, gays dropped the brand like a hot potato. Where previously, as a self-respecting gay man, you showed yourself at least three times a week with the moose logo on your broad chest, it now became ‘not done’ to wear the brand.

Jeffries’ legacy

When Jeffries took over in 1992, A&F had 36 stores and sales of $50 million. In 1996 the company had approximately 125 stores and a turnover of $335 million. This has now risen to almost 4 billion.

Throughout his two decades leading A&F, Jeffries has acknowledged the company’s intention to sexualize its marketing, but adamantly denied there was anything inappropriate about it. “I think what we represent sexually is healthy. It’s playful. It’s not dark. It’s not humiliating! And it’s not gay, and it’s not straight, and it’s not black, and it’s not white. It’s not about labels. That would be cynical, and we are not cynical! It all portrays this beautiful camaraderie, friendship and playfulness that exists in this generation and, honestly, doesn’t exist in the older generations.”

Jeffries has completely revamped the company with his signature homoerotic advertisements and shirtless ‘greeters’. However, his obsession with beauty and youth seemed to get the better of him. Jeffries came under fire after criticizing overweight clients and even faced an age discrimination lawsuit from the male models who worked on his private jet.

He also had a strong financial interest in the company. Mike owned 3% of the shares, which at the current market cap are worth about $60 million (at an all-time high of $100 million). In addition to these shares, he received hundreds of millions of dollars in salary and bonuses. In the ten years between 2004 and 2014, this added up to around $400 million.

Exit

In December 2013, Mike was named the “Worst CEO of 2013” by analyst Herb Greenberg after Abercrombie’s stock fell 40% in the previous twelve months. CNBC’s Jim Cramer also featured Jeffries on his ‘Wall of Shame’.

At the end of 2014, 70-year-old Jeffries resigned ‘after a decline in turnover’, read ’11 straight quarters of poor performance’ (probably, no pun intended). Earlier that year, A&F dismissed Jeffries from his chairman position in response to pressure from an investment company. Investors appeared to relish Jeffries’ departure as shares subsequently rose about 7.5 percent. His departure also provided an excuse for the gay press to revisit his legacy, for example out.com with ’21 Gayest Abercrombie & Fitch Moments’.

The way up

After Jeffries was fired, Fran Horowitz took over as CEO in February 2017.

To counter competition from more downscale fast-fashion rivals like Forever 21 and H&M, A&F announced slight changes to its image. They promised to reduce the level of sexually charged advertising style and instead focus more on customer service. A&F also then changed the job title of store associates from ‘models’ to ‘brand representatives’, and allowed for a less tightly controlled, more individualistic dress code.

According to a Q1 2021 report, that was “the group’s best Q2 operating profit and margin since 2008, with revenue exceeding pre-pandemic levels.” It was the tenth consecutive quarter of sales growth. Things went less well in 2022, but in Q2 of this year turnover grew by 16% again.

Maybe they won’t go down after all. But they no longer engage in Marketing the Rainbow.

Conclusion

A remarkable journey of an – especially by American standards – very old brand, which only became really successful after a century. This mainly happened because they appealed to gay consumers, although they themselves denied that this was the intention. However, their advertisements fit perfectly within the framework of “Marketing the Rainbow”. They also collaborated with an LGBT charity and have been releasing Pride collections for a few years. However, their intentions are vague, their statements harmful and their policies (were) shameful. I give them a pass, a 6, because they have created so much beautiful advertising material: artistic, aesthetic and with a lot of ‘eye candy’.

Alfred Verhoeven is a marketer and is in the final phase of his PhD research Marketing the Rainbow. He previously wrote for ILOVEGAY about Abercrombie & Fitch : The Rise & The Fall, Play the gayme: about SIMS and Candy Crush, Diversity in Toys, LEGO does the rainbow, Barbiemania, Bud Light and the 4 bln dollar woman, Dutch retailer HEMA loves everybody, Pronouns, About those rainbows, Alphabet soup, M&M’s and the lesbian invasion, Magnum and the lesbian wedding,  Marketing the Rainbow: the process and all that came before it, Sport and (un)sportmanship,  Why you need a supplier diversity program, BeNeLux LGBTIQ+ Business Chamber (BGLBC), From B2C and B2B to B2G and G2G (oh, and G2C), The Men from Atlantis, The other kind of cruising, Booking.com, Home Deco, Haters and trolls: the ‘letter to the editor’ of the 21st century, 5 Bizarre LGBT Videos, TRANSparency, Transgender persons as a target group, Matchmaking, 5 videos that went viral, From Representation To Respect, Cultural sensitivities and social involvement in marketing, 4 reasons to practice diversity and The Rules of Market Segmentation.